International Tropical
Timber Organization
INTERNATIONAL ORGANIZATIONS
CENTER,5TH FLOOR,
PACIFICO-YOKOHAMA1-1-1,
MINATO-MIRAI, NISHI-KU,
YOKOHAMA, 220-0012, JAPAN
FACSIMILE
++81-45-223-1121
Tropical Timber Market Report
1 - 15th September 1998
Contents
International Log Prices
Domestic Log Prices
International Sawnwood Prices
Domestic Sawnwood Prices
International Ply and Veneer Prices
Domestic Ply and Veneer Prices
Other Panel Product Prices
Prices of Added Value Products
Rubberwood and Furniture Prices
p1
p3
p3
p5
p6
p7
p7
p8
p8
Report From Japan
Report From Korea
Report From China
An Update on the UK
Report from North America
p9
p10
p10
p13
p15
World Value of the US Dollar
Abbreviations
ITTO Fellowship Grants
p19
p19
p20
Appendix:
Tropical Timber Product
Price Trends
Last week Malaysia formal announced
that the economy was in recession as
economic growth fell by 6.8% in the
second quarter of 1998. The government
hopes the new currency regulations will
bring more money into the domestic
market to boost growth. The steps are a
reversal of a policy that favoured
controlling the exchange rate by austerity
measures and a tight monetary policy.
The new currency controls threw financial
markets into confusion, and foreign
exchange trade came to a virtual halt as
dealers scrambled to come to grips with
the situation.
International Tropical Log Prices
Sarawak Log Prices
On the 2nd September Malaysia's central
bank, Bank Negara, announced that the
exchange rate for the ringgit will be set at
3.80 per US dollar for an indefinite
period.
Apparently there will be no
value attached to the ringgit outside
Malaysia after Oct. 1. All Malaysian
currency overseas will have to be brought
back to the country. The ringgit has lost
nearly 40 percent of its value against the
US dollar since the Asian crisis broke in
July 1997.
Sarawak Log Export Prices
(FOB)
per Cu.m
Meranti SQ up
US$115-120 
small
US$85-90 
super small US$55-60 
Keruing SQ up
US$120-130
small
US$90-100
super small US$70-75
Kapur SQ up
US$110-120
Selangan Batu SQ up US$125-130 
Solomon Islands
1
Forestry Department Indicative FOB
Prices and forecast price trend
Forestry Department
Indicative Price
Forecast
per Cu.m
Movement
Group 1A
Kwila
Group 1B
Palaquium
Planchonella
Calophyllum
Pometia
Gonostylus
Schizomeria
US$120
no change
US$ 95
''
''
''
Mod. fall
Mod. fall
Mod. fall
Mod. fall
Mod. fall
Mod. fall
''
Group 2
Canarium
Burckella
Terminalia
US$ 80
''
''
Signif.fall
Signif.fall
Signif.fall
Group 3
Dillenia
Celtis
Alstonia
Dysoxylum
Eugenia
Endospermum
Vitex
Amoora
US$ 75-80
US$ 75-80
''
''
''
''
US$120
US$90
Signif.fall
Signif.fall
Signif.fall
Signif.fall
Signif.fall
Signif.fall
Signif.fall
Signif.fall
Group 4
Campnospermum US$75-80
Parinari
US$70
Marathes
''
Mixed white
''
Mixed red
''
Low Grade Logs US$70
70cm+ LM-C
80cm+LM-C
80cm+LM-C
70cm+LM-C
Logs
Teak
3rd Grade
4th Grade
SG-1 Grade
SG-2 Grade
SG-3 Grade
SG-4 Grade
per Hoppus ton FOB
July
August
US$3289
US$2958
US$2883 
US$2122
US$2141 
US$1648
US$1589 
US$958
US$993 
Padauk
Assorted
Pyinkado
Gurjan
Hnaw
Sagawa
Pyinma
Thigadu
Thitya
US$201
US$168
US$287
US$259
US$171
-
US$577
US$196 
US$124 
US$270 
US$245 
US$207
US$130 
US$232
Hoppus ton equivalent to 1.8 Cu.m. Teak
3-4th Grade for sliced veneer. Teak grade
1-4 for sawmilling. SG Grade 3 3ft - 4ft
11" girth, other grades 5ft girth minimum.
Papua New Guinea
no change
no change
no change
no change
no change
no change
Cameroon Log Prices
FOB
N'Gollon
Ayous
Sapele
Iroko
expected to improve. Average prices for
the most recent Tender Sale held by the
Myanma Timber Enterprise on the 24th
August are given below.
per Cu.m
FFR 1350
FFR 1000
FFR 1650
FFR 1650
FOB
Group 1
Taun
Calophyllum
Group 2
Amoora, Hopea
Group 3
Celtis, Watergum
Group 4
Mixed Reds/Whites
Myanmar
Domestic Log Prices
Hardwood log prices are moving down but
demand for Teak is firm and prices are
Brazil
per Cu.m
US$70-73
US$71-75
US$50-55
US$47-50
US$40-45
2
IBAMA is continuing inspection of forest
management plans in Mato Grosso and
has revealed that some timber companies
are not properly implementing their forest
management plans. Some companies have
lost their harvesting licenses.
The Timber Industry Association of Mato
Grosso is promoting a Seminar in Cuiaba
(Mato Grosso State). The seminar will be
held in 17 and 18 th September, and will
focus on the contribution of the timber
industry to the social and economic
development of the western part of the
Amazon region.
Logs at mill yard
Mahogany Ist Grade
Ipe
Jatoba
Guaruba
Mescla(white virola)
per Cu.m
US$340
US$68
US$44
US$35
US$42
Indonesia
Domestic log prices
Plywood logs
Face Logs
Core logs
Sawlogs (Merantis')
Falkata logs
Rubberwood
Pine
Mahoni
per Cu.m
US$60-70 
US$35-4 
US$50-65 
US$40-45
US$26-28
US$50-55 
US$330-350
Malaysia
Logs Domestic
(SQ ex-log yard)
DR Meranti
Balau
Merbau
Peeler Core logs
Rubberwood
Keruing
per Cu.m
US$120-130 
US$115-120
US$140-145 
US$60-65 
US$23-23
US$120-125
per Cu.m
Caoba
(Swietenia macrophylla)
US$227 
Capirona
(Calycophylum spruceanum) US$33 
Catahua (Hura crepitans)
US$15
Cedro (Cedrela odorata)
US$110 
Estoraque (Miroxilon balsamun)US$40 
Huayruro (Ormosia sp)
US$48 
Tornillo
(Cedrelinga catenaeformis)
US$59 
International Sawnwood Prices
Brazil
The Asian crisis, and now the Russia
crisis, is having a strong impact on the
Brazilian economy. Brazil lost around
US$6 billion in foreign reserves during
August. Reserves dropped US$10 bil. to
US$59 bil. over the past two weeks and
the government has increased interest
rates to a massive 49% in an effort to stem
any further outflows of capital. The
higher interest rates will be an added
burden to the timber industry.
Export Sawnwood
per Cu.m
Mahogany KD FAS FOB
UK market
US$990
Jatoba Green (dressed)US$460
Asian Market
Guaruba
no business
Angelim pedra
no business
Mandioqueira no business
Pine (AD)
US$145
Peru
Peru
Domestic Log Prices Pucallpa
3
Export Sawnwood FOBCallao/Lima
per Cu.m
Caoba (Mahogany)
US$950 
Cedro (Red Cedar)
US$508 
Cumala (Virola)
US$206 
Guyana
Guyana continues to feel the impact of the
South East Asian crisis, export markets
are depressed and producers are supplying
more timber to the already depressed
domestic market. More recently, a cause
for concern is the increasingly depressed
market in North America, which is a
major market for Guyana’s plywood (in
1997, 69% of plywood exports went to
North America).
On August 14, 1998, the Forest Products
Association (FPA) of Guyana issued a
press statement concerning the state of the
forest industry, in which it requested the
government to assist the industry to cope
with the crisis. Among other things the
FPA asked the government to review the
exchange rate mechanisms and to consider
financing a kiln drying facility.
In the light of the changing market
conditions,
the
Guyana
Forestry
Commission is currently undertaking a
review of the industry so as to formulate
policy options to address industry
concerns.
Length 1.8m&up mostly 3-4m
per Cu.m
Air Dry
DM310-350
Kiln Dry
DM390-500
Wawa Square Edged AD Lumber
Squares 23x23mm up to 75x75mm
Boards 100mm & up
width 0.9m&up Length DM300-505
Wawa Square Edged KD Lumber
range
DM400-600
Plantation Teak
per Cu.m
Flooring Specs for
Hong Kong and Macau US$630-700
Garden Furniture blanks
for UK
US$900-1200
Malaysia
Sawn Timber
Export(FOB)
per Cu.m
Dark Red Meranti (2.5ins x 6ins & up)
GMS select & better (KD) US$425-435
Seraya
Scantlings (75x125 KD) US$540-550
Sepetir Boards
US$180-190 
Perupok (25mm&37mm KD)
US$690-700 
K.Semangkok
(25mm&37mmKD)
US$690-700
Ghana
Rough Sawn Prices FOB
Niangon for France
25 x 100 mm
32 x 100 mm
Lengths 1.5m - 4.0m
per Cu.m
DM730
Afzelia
per Cum
31 x 81mm and 105mm
AD
DM840
KD
DM960
Wawa Boules, FOB
For Germany, France,UK and Italy
Thicknesss 16-100mm
Width 100mm and up
Taiwan Province Imports
Rubberwood
25mm boards
50-75mm squares
per Cu.m
US$230-240 
US$285-295 
4
75-100mm squares
US$340-350
Sepetir
GMS (AD)
Ramin less than 2 ft.
greater than 2 ft.
Oak 25mm boards
Maple
Cherry
US$195-200 
US$510-525 
US$610-620
US$840-850
US$1400-1500
US$1400-1500
(Calycophylum spruceanum)
Catahua (Hura crepitans)
Cedro (Cedrela odorata)
Huayruro (Ormosia sp)
Shihuahuaco (Dipterex sp)
Tornillo
(Cedrelinga catenaeformis)
Copaiba (Copaifera)
US$106 
US$64 
US$339 
US$145 
US$141 
US$198 
US$120 
Ghana
Domestic Sawnwood Prices
Brazil
In the domestic market lumber from the
Amazon is gradually loosing out to
eucalyptus. In order to keep their market
share producers in the north are reducing
prices. There is information that some
sawmills, that used to export to Asia, are
selling sawn LKS in the domestic market
at prices as low as US$120 per Cu.m, this
price is lower than that of pine.
Sawnwood (Green ex-mill)
Northern Mills
per Cu.m
Mahogany
US$710
Ipe
US$390
Jatoba
US$320
Southern Mills
Eucalyptus AD
US$150
Pine (KD) First Grade US$135
Dahoma, Chenchen, Antiaris
per Cu.m
Mill Run 50x150mm US$95-125
50x100mm
US$72-105
50x50mm
US$105-150
25x300mm
US$72-105
Mixed Redwood
40x300x3.6m
US$105-240
Indonesia
Sawn timber
Domestic construction material
Kampar
AD 6x12-15x400cm
KD
AD 3x20x400cm
KD
Keruing
AD 6x12-15cmx400
AD 2x20cmx400
AD 3x30cmx400
US$220-230
US$310-330
US$310-320
US$390-400
US$190-200
US$200-210
US$220-230
Malaysia
Peru
Caoba
(Swietenia macrophylla)
Capirona
per Cu.m
US$593 
Sawnwood
per Cu.m
Balau(25&50mm,100mm+)
US$160-170 
Kempas50mm by
(75,100&125mm) US$120-130 
Red Meranti
(22,25&30mm by180+mm)
US$210-220 
Rubberwood
25mm & 50mm Boards US$150-160 
50mm squares US$195-200 
75mm+
US$210-215
5
Myanmar
Pine Veneer (C/D)
US$165-185
per ton (1.4Cu.m)
Sawn 6 ft. and up length
Teak
Kyat 70,000
Pyinkado
Kyat 60,000
Padauk
Kyat 60,000
Gurjan
Kyat 35,000
Mixed Species
Kyat 25,000
Mahogany Veneer
0.7mm
per Sq.m
US$2.50
International Plywood and Veneers
Prices
Indonesia
Plywood (export, FOB)
MR,
Grade BB/CC
2.7mm
3mm
6mm
Plywood FOB
White Virola (US Market)
5.2mm OV2 (MR)
US$280
15mm BB/CC (MR) US$260
For Caribbean countries
White Virola 4mm
US$360
9mm
US$300
Pine USA market
9mm C/CC (WBP)
US$240
15mm C/CC (WBP) US$230
Malaysian Plywood
per Cu.m
US$275-280 
US$245-255 
US$200-210
Ghana
Rotary Cut Veneer FOB
per Cu.m
Face Veneer
1-1.6mm
Ceiba
US$245
Koto 30% jointed allowed
US$510-520
Plywood 1220 x 2440mm Grade c/c WBP
FOB Ceiba for the German market
per Cu.m
4mm
DM735
6mm
DM623
9mm
DM613
12mm
DM600
15mm
DM587
18mm
DM573
Brazilian Plywood and Veneer
Veneer FOB per Cu.m
White Virola Face
2.5mm
US$200-260
The timber industries are experiencing
price increases for freight containers,
particularly
for
European
ports.
Container charges are also increasing for
other routes and, in addition, there is a
shortage of containers.
The shortage of containers is due to the
imbalance of cargo movements as, for the
past few months, imports have dropped
drastically as a result of the economic
situation in Malaysia.
Malaysia
experienced a trade surplus for the past
few months averaging some RM2.0 billion
(US$525 million). In August the trade
surplus was about RM2.7 billion (US$710
million). The trade surplus is likely to
continue as Malaysian manufacturers are
currently very competitive in the
international market.
MR Grade BB/CC FOB
per Cu.m
2.7mm
US$275-285 
3mm
US$245-255 
3.6mm
US$210-220
9-18mm
US$180-190
6
Domestic plywood
3.6mm
9-18mm
US$215-220 
US$210-215 
Domestic Plywood Prices
Export Prices
Blockboard 18mm
White Virola Faced
B/C
Brazil
Rotary Cut Veneer
(ex-mill Northern Mill)
White Virola Face
White Virola Core
per Cu.m
US$150
US$118
Plywood
(ex-mill Southern Mill)
Grade MR
4mm White Virola
15mm White Virola
4mm Mahogany 1 face
per Cu.m
US$510
US$360
US$1,080
Indonesia
Domestic MR plywood
(Jarkarta)
9mm
12mm
15mm
18mm
dumping tariffs, related to the individual
producer (for companies not participating
in the investigation the tariffs were fixed
under the heading "other"): Brazilian
Duratex SA. 23.1% (other 28.2%).
per Cu.m
US$220-235
US$205-215
US$190-200
US$175-185
Other Panel Product Prices
Brazil
per Cu.m
US$230
Domestic Prices
Ex-mill Southern Region
Blockboard
15mm White Virola Faced
15mm Mahogany Faced
Particleboard
15mm
per Cu.m
US$390
US$810
US$230
Indonesia
Other Panels
per Cu.m
Export Particleboard FOB
9-18mm
US$80-95 
Domestic Particleboard
9mm
US$130
12-15mm
US$115
18mm
US$100
MDF Export (FOB)
12-18mm
US$115-120 
MDF Domestic 12-18mmUS$160-170 
Anti-dumping tariffs for hardboards
According to recent press releases in
August, and following the application by 8
EU hardboard producers, the EUCommission imposed anti-dumping tariffs
on imports of raw and processed
hardboard from Brazil, Bulgaria, Estonia,
Latvia, Lithuania, Poland and Russia.
These preliminary anti-dumping tariffs are
calculated from the net-prices free EUborder, prior to customs-clearance. The
dumping price gaps were calculated in per
cent, based on the price CIF EU-border.
The Commission fixed the following anti-
Taiwan Province of China, Imports
MDF
Domestic Prices
3mm thick
16-18mm x 4' x 8'
per Cu.m
Particleboard
12-18mm (4x8)
per Cu.m
US$130-140 
US$225-235 
US$175-185
7
Ghana
Malaysia
Particleboard (FOB)
6mm & above
Domestic
6mm & above
per Cu.m
US$100-105
US$120-125
MDF (FOB)
Less than5mm
Greater than 6mm
per Cu.m
US$160-165
US$120-130
Domestic Price
US$155-160 
Wawa
10mmx23mmx2.16m - 2.45m per Cu.m
some black spots allowed
DM 900
Finger jointed mouldings
DM 850
With 30% Filled holes
DM 550
5mmx24mmx2.43m
DM1200
Dahoma
Blanks KD 20% No defects
25mmx90mmx510, 533, 1000, 1273
1800
Stg505
Albizzia Blanks
25mmx90mmx510, 533, 1000, 1273
1800
Stg505
Odum Blanks
KD 14% PAR
25,28x66, 90x674,728,762 Stg660-780
(for the Irish market)
Prices of Added Value Products
Furniture and Rubberwood Parts
Indonesia
Malaysia
Mouldings
Ramin casings
per Cu.m
(for the Italian market) US$680-690 
Laminated Scantlings US$330-340 
Laminated Boards
Falkata wood
US$250-265 
Red Meranti Mouldings
11x68/92mm x 7ft up
Grade A
US$570-590
Grade B
US$450-460
Finger jointed
laminated boards
top grade
Malaysia
Brazil
Mouldings (FOB)
per Cu.m
Selagan Batu Decking US$530-540
Laminated Scantlings
72mmx86mm
US$480-490 
Red Meranti Mouldings
11x68/92mm x 7ft up
Grade A
US$620-630
Grade B
US$500
per Cu.m
US$515-530 
US$590-600 
Dining table
Solid rubberwood laminated top 3' x 5'
with extension leaf
US$28-30ea
Windsor Chair
US$8.0-8.5ea
Colonial Chair
US$10.0-11.0ea
Queen Anne Chair (with soft seat)
without arm
US$15.5-16.5ea 
with arm
US$21-22ea 
Edge Glued Pine Panel
for Korea 1st Grade
Last price
US Market
per Cu.m
no business
US$570
US$490
8
Taiwan Province of China
Taiwan P.o.C is expected to post its worst
economic growth for years in 1998 but,
even at the current rates, the island
remains one of the bright spots in Asia
where countries are reeling from
economic crises. The island's GDP is
expected to grow 4.9% in 1998 and 5.2%
in 1999. Exports, the previous 'engine' of
growth, are declining as Asian markets
crumble,
however, strong private
investment and accelerated public works
activity is sustaining growth.
Furniture
Dining suite (FOB)
Oak Veneered MDF tables and
chairs (6 per set) 4ft dia.
US$110-120per set 
Occasional table Cherry veneer
top 2ftx4ft
US$20-25ea
Report From Japan
Unstable Currencies
Fluctuating world currencies are affecting
wood products imports into Japan. The
problems in Russia will certainly impact
producers in Russia and this casts dark
shadow over future supplies of logs for
Japan.
Meanwhile, the Malaysian
government revalued the ringgit which
could push export prices higher. In Japan,
the rate of the yen against the dollar
soared more than 10 points during the past
week. These erratic currency rate changes
make future dealings extremely uncertain.
Theoretically, the devalued rouble should
encourage exports but log supply is
extremely tight with very few offers
available. The CIF price for Red pine for
22-36cm by 4 metre jumped from $95 to
$103 per Cu.m. Larch prices moved from
$85 to $90 per Cu.m CIF. Whitewood
prices are getting close to $80. Traders
complain that prices are moving without
logs being available.
In Malaysia export prices for logs and
plywood are moving up. Meranti regular
(SQ up) FOB price was US $110 –115,
per Cu.m and is now around US$120.
Plywood prices are also moving up by
around US$15 to 20, per Cu.m with
concrete formboard at US$220-230 per
Cu.m FOB.
Due to the depressed plywood market in
Japan even previous offers were not
acceptable so these new offers make much
more difficult for Japanese importers.
The Japanese yen gained about 7% on the
dollar but the increases in export price in
Malaysia makes the cost higher for
Japanese importers. Some buyers are
shifting to Indonesia as prices are
US$230-235 per Cu.m C&F (almost same
as Malaysian FOB) however prices are not
low enough to correspond to current
market expectations. Japanese buyers are
now watching to see if the yen will
continue to strengthen which may make
these prices acceptable.
Imports of Forest Products Down
Forest products imports for the first half
of this year totalled 564 billion yen a drop
of 43% compared to the same period last
year. The amount of imported logs and
lumber declined to a historically low level
down 50% in value terms and down 37%
in terms of volume. The biggest losers are
North American and European lumber
down 60% in value terms and 58% in
volume. Softwood plywood imports from
North America dropped 60% being able to
compete with S.E. Asian products. Total
plywood imports fell by 1.1 mil. Cu.m
compared to the same period last year.
Log, Lumber and Panel Prices
Logs For Plywood Manufacturing
CIF Price Yen per Koku
Meranti (Hill, Sarawak)
Medium Mixed
5,500 
Meranti (Hill, Sarawak)
STD Mixed
5,600 
Meranti (Hill, Sarawak)
Small Lot
(SM60%, SSM40%)
4,600 
Taun, Calophyllum (PNG)
9
and others
Mix Light Hardwood
(PNG G3-G5 grade)
Okume (Gabonese)
Keruing (Sarawak)
Medium MQ & up
Kapur (Sarawak) Medium
MQ & up
4,600
3,800
6,500
7,500
Particle Board
12mm x 4'x8'
15mm x 4'x8'
18mm x 4'x8'
W6,900
W7,300
W8,900
5,800
Sawnwood
Logs For Sawmilling FOB Price Yen per
Koku
Melapi (Sarawak)
Select
9,500
Agathis (Sarawak)
Select
8,500 
Lumber
FOB Price Yen per Cu.m
White Seraya (Sabah)
24x150mm, 4m 1st grade
170,000
Mixed Seraya 24x48mm,
1.8 - 4m, S2S
38,000
Red Oak 5/4x6 ins and wider
FAS (US East Coast)
125,000
Report from Korea
Domestic wholesale prices
per Cu.m
Sarawak Meranti regular W333,000
Solomon Taun regular
W233,100
Solomon Taun Low grade W149,850
Solomon Dillenia regular W233,100
Solomon Dillenia Low gradeW173,160
Low grade Calophylum
W183,150
NZ Radiata 11m
W139,860
Price of Panels: ex factory per piece
Combi-Plywood
12mm x 4'x8' T-1
12mm x 3'x6' T-1
12mm x 4'x8' T-2
12mm x 3'x6' T-2
W14,500
W 8,500
W13,000
W 7,500
Meranti S4S 40mm
Meranti
Rough Sawn 45mm
per cu.m
W540,000
W480,000
Report From China
Competition Fiercer
As a consequence of the rapid
development of China's economy, the
growing rate of home ownership and the
start-up of major infrastructure projects,
demand for timber is increasing. At the
same time, competition between products
is becoming fiercer, particularly in
Shanghai,
which
ranks
first
in
consumption of imported timber. Over
recent months the trade has witnessed
several trends:
Firstly, the imports of
Douglas fir,
Spruce, Hemlock from the US has
declined sharply and these timbers did
feature prominently in the consumption of
imported timbers. On the other hand
imports of Oak, Maple, Cherry, Beech
and other hardwoods from North America
and Europe (France, Germany and Italy)
have increased gradually to meet the
demand for high grade decorative timber.
In order to meet the domestic demand for
high grade furniture, doors, windows,
flooring and decorative veneer, imports
through the border trade of high value
species such as teak and pterocarpus
represents a rising trend.
Tego Plywood
12mm x 4'x8' Tego
12mm x 3'x6' Tego
W23,000
W12,500
Okoume log imports from West Africa for
plywood manufacture have weakened
because prices for imported plywood from
10
Indonesia and Malaysia have fallen
sharply as a result of the SE Asian
financial crisis. It is reported that the
price of the plywood has fallen to the
current of 1600 yuan per Cu.m from a
high of 2500 yuan.
Timbers including Ash, Oak and Pinus
sylvestris imported from Russia and Korea
sell well because of their moderate price
and good quality. Pinus sylvestris logs of
good quality and straight grain from
Russian natural forests, for example, sells
at a price of only 800 yuan per Cu.m
while the US Douglas fir log from forest
plantations sells at a much higher price of
1350 yuan per Cu.m.
Increase in Plywood Transit
According to recently released statistics
from the government of Hong Kong
Special Zone, the transit of Indonesian and
Malaysian plywood from Hong Kong to
mainland China increased to 200,000
cubic metres the first quarter of this year,
a rise of around 75% over the same
period last year
The reason for the rapid increase in the
transiting of plywood from Hong Kong to
mainland China was due to Indonesian
and Malaysian plywood becoming more
price competitive, this gave more traders
in Hong Kong better opportunities to sell
through wider networks on the mainland.
The government of China encourages
plywood imports as a priority since
domestic plywood supplies cannot meet
the demand in mainland China.
According to news coming from Hong
Kong timber dealers, the price for
Indonesian and Malaysian plywood to
Hong Kong is US$ 280 per Cu.m, down
by 20% over the same period of last year.
The price quotation for some plywood is
less than US$250, down 30%. Some
traders are complaining that the quality of
plywood is hard to guarantee at these
prices.
It is apparent that, in 1998, demand for
timber for agriculture, infrastructural
works, interior decoration and furniture
has increased considerably in Guangdong,
especially at Guangzhou and its adjacent
markets.
At present, prices at Guangdong timber
market are rising. Chinese red pine logs 4
metres length and with a diameter of 1828 centimetres are selling at a price of 550
yuan per Cu.m at the forest site and at 710
yuan per Cu.m in the consumer market.
The rapid development of construction in
Guangdong province and growing exports
has promoted a rise in timber
consumption. Timber stocks appears low
currently. Stocks in forest regions are said
to be down by 8% over the same time of
last year. Over the whole of Guangdong
province log stocks have fallen by nearly a
half compared to the same period of last
year and sawnwood stocks are reportedly
down by about a third.
As to domestic available resources, these
are becomes fewer and fewer.
The
measures introduced to protect the natural
forests this year have influenced the
timber market in Guangdong.
It is
forecast that little timber will enter the
Guangdong market from near-by timberproducing provinces of Guangxi and
Guizhou.
Boost to Housing Starts
China will boost investment in residential
housing construction in an effort to help
reach the targeted 8% GDP growth this
year. The country plans to build 105.5
million square metres of low-cost housing
in the remaining months of this year,
according
to
Vice
Minister
of
Construction, Song Chunhua.
Overall, China's state-owned companies
had began 366 million square metres of
residential housing construction in the
first seven months of this year, up 16%
form the year-earlier period.
Demand in Guangdong
11
The new low-cost housing will involve
total investment of 80.58 billion yuan
($9.73 billion), of which 30.05 billion
yuan will reportedly come from state
commercial banks, local governments and
real estate companies. The government
has doubled its housing construction
investment
targets
of
the
year.
Investment in commercial building
increased 22% to 77.52 billion yuan in
the period January to July.
Guanzhou
Lauan Log
Keruing log
White oak 2 ins sawnwood
Canadian sawnlog
length: 4m+
US maple Lumber 2 ins
Teak sawlog 4 m+
Sawlog from SE Asia
1300
1800
9000
2300
12000
6500
3000
Wholesale Prices Indonesian and
Malaysian plywood 3mm 1220x2440
yuan per Cu.m
Shanghai
Radiate pine log
length:6m, dia. 26cm+
Douglas fir log 28cm
Lauan lumber ( mixed)
White oak lumber 2 ins
Canadian sawlog 4m+
US maple lumber 2 ins
Teak sawlog 4 m+g
SE Asian Sawlog
Beijing
Lauan log ( mixed)
Teak sawlog 4m+
900
1200 
1200 
11000
1500
11000
8000
1450 
yuan per Cu.m
2450
9500
Qindau
Luan Log (mixed)
White oak lumber
2 inches thick
Keruing log
1200
9000
900
yuan per sheet
Beijing
35
Shanghai
27.5
Harbin
40
Shenyan
28
Zhengzhou
29.5
Lanzhou
36
Shijiaozhuang
35
Yingchuan
35
Xian
30
Jinan
38
Hefei
37
Qindau
40
Chongqing
26
Chengdu
26
Nanjing
29
Hangzhou
30
Wuhan
26
Changsha
31.5
Guanzhou
25
From Europe an Update on the UK
Nanjing
Douglas fir log
Lauan log
Teak sawlog 4 m+
Sawlog from SE Asia
American maple lumber
2 inches
Hangzhou
Douglas Fir sawlog length:
more than 4m
Lauan log
Keruing log
Canadian sawlog 4m+
Teak sawlog 4m+
SE Asian Sawlog
1450
1800
9000
3200
11000
1600
1450
1500
1250
8500
3700
In 1997 the UK production of kitchen
furniture was worth ECU 941.3 million. In
the same year, consumption of kitchen
furniture was ECU 953.7 million (with the
UK accounting for 10.6% of total
European consumption). Exports were
worth ECU 64.3 million, while imports
were ECU 76.7 million.
Forest Fencing Ltd, the largest UK
wooden garden products manufacturer,
has been taken over by a group of
managers through a buy-in-buy-out
arrangement. Forest Fencing operates five
production plants and is estimated to have
12
a 20% share of the wooden garden
products sector in the UK. The company
is now planning to buy businesses in
related areas of manufacturing.
From February to April 1998 the output
of sawmilling and planing firms increased
in the UK by 17.6% compared to the same
period of 1997. The output of furniture
(excluding kitchen furniture) fell by 11%.
In May the factory gate prices of UK
producers of wood and wood products
registered a 0.3% decrease compared with
May 1997.
Manufacturer's Prices
Wooden Windows
Upper Price Hardwood 120x135cm
Sterling, 301.15
Medium Price Hardwood 120x135cm
Sterling 244.75
Lower Price Softwood 120x135cm
Sterling 115.20
Solid Wooden Doors
Upper Price Meranti (new range)
76.2x198.1x3.5cm
Sterling 351.00
Medium Price Sapele
76.2x198.1x3.5cm
Sterling 142.20
Lower Price Veneered
76.2x198.1x3.5cm
Sterling 49.00
Kitchen Chair
Upper Price Solid Oak
Sterling 333.00
Dining Chair
Upper Price African Mahogany
Sterling 333.00
Medium Price African Mahogany
Sterling 224.00 
Dining Table
Upper Price African Mahogany
80x160cm
Sterling 1134.00
Medium Price African Mahogany
80x160cm
Sterling1006.00 
Lower Price African Mahogany
80x160cm
Sterling 693.00
Furniture and Components
Wardrobe Door
Lower Price 50x180cm Sterling 63.15
Kitchen Cabinet Door 71.5x49.5cm
Medium Price Oak
Sterling 19.90
Drawer Front
Upper Price
Melamine Faced Particleboard
100x10cm
Sterling 0.77/pc
Medium Price
Melamine Faced Particleboard
100x10cm
Sterling 0.62/pc
Lower Price
Melamine Faced Particleboard
100x10cm
Sterling 0.55/pc
Sawnwood Prices in the UK
FOB plus Commission
Teak 1st Quality 1"x8"x8'
per Cu.m
Stg2650
Brazilian Mahogany
FAS 25mm
Tulipwood FAS 25mm
Cedro FAS 25mm
Stg694
Stg245
Stg408
DR Meranti Sel/Btr 25mm
Keruing Std/Btr 25mm
Stg260
Stg225 
Sapele
Iroko
Khaya
Utile
Wawa
Stg310
Stg355
Stg330
Stg395
Stg190
FAS 25mm
FAS 25mm
FAS 25mm
FAS 25mm
No1. C&S 25mm
Plywood and MDF in the UK
CIF
Brazilian WBP BB/CC 6mm
" Mahogany 6mm
Indonesian WBP 6mm
Eire, MDF BS1142
12mm
per Cu.m
US$450
US$1290
US$350
per 10 Sq.m
Stg33.50
Manufactured Items
13
CIF
Carolina Door US$25.50
Directors Chair US$9.00
8" Salad bowl Stg2.00
Wholesale
Stg34
Stg9.00
Stg5.00
Other News from Europe
In the first six months of 1998 the French
group Seribo (manufacturer of furniture
and parquet), achieved a turnover of FFr
593 million, registering a 4.4% increase
over the same period of 1997.
In order to return to profits and to boost
business development, the German Alno,
kitchen furniture producer based in
Pfullendorf, will cut about 200 jobs by
next year. The company will also invest
DM 42 million to modernise an assembly
plant: this will reduce the assembly time
for a cupboard by 50%.
In 1998 the furniture market in Hungary is
expected to grow in real terms by between
5-10% over 1997, when it reached Ft 4550 billion; these figures do not include the
office furniture market, which was worth
about Ft 18 billion last year. In 1998
imports should benefit from the expected
domestic market growth, in 1997 imports
registered a 10.3% increase to US$ 192.1
million.
In 1997 the French furniture industry
reported a turnover of FFr 66 billion. In
the same year, furniture imports were
worth FFr 18.3 billion, compared to FFr
16.8 billion in 1996. Exports grew from
FFr 10.2 billion in 1996 to FFr 11.3
billion in 1997. The French furniture
manufacturers announced, during the last
congress of Unifa (the French association
of furniture firms), that they aim at
doubling their export sales by the year
2005.
The Finnish Kontiopuu, a kitchen
furniture producer, has been taken over by
the Russian Voltrade. Following this
change of ownership, Kontiopuu's
products will be sold in outlets to be set
up in Moscow. Sales in the Russian
market are expected to reach several
million Finnish marks a year.
Preparing for the Euro
Businesses preparing financial systems for
a smooth changeover to the Euro can now
consult practical guidelines published by
the European Commission.
Although companies in non-participating
Member States will be affected less by the
introduction of the Euro, the guidelines
state that they should be prepared to deal
with transactions denominated in Euros.
Copies of Preparing Financial Systems for
the Euro can be downloaded from the
Internet at http://europa.eu.int/comm/dg15
or ordered by post from: Unit DG
XV.D.3,
C107
02/57,
European
Commission, 200 rue de la Loi, B-1049
Brussels, Belgium, Fax: 00 32 2 299 4745.
Report from North America
The American economy is still strong.
New and existing housing sales are
healthy and consumer confidence is at a
28-year high.
Inflation appears to be
under control and the Federal Reserve
Board appears ready to lower interest
rates.
There are some signs, however, that the
US economy may cool down during the
second half of this year and into 1999.
Many indicators point to a less vibrant
business environment.
Similarly, the
lumber business is showing signs of
weakness and prices are generally lower.
After two hectic years, the hardwood
market has definitely stabilised in recent
months according to AKTRIN the
N.American market research institute.
14
Some inventory reduction has been going
on in the furniture and secondary wood
product manufacturing segments. While
this is partially due to the ready
availability of lumber from producers, it is
also an indication of smaller order-book
positions of manufacturers.
Summer is traditionally a slow season as
many logging operations and sawmills are
closed for vacations or maintenance. The
demand for lumber by manufacturers is
subject to the same cyclical influences,
infact, lumber production frequently outproduces market demand in the summer
months.
Apart from seasonal factors, declining
exports to many Asian destinations are a
serious drag on sawmills production.
Unfortunately the days have gone when
lower export shipments happily coincided
with a very strong US economy. The
excess lumber from sagging exports can
no longer be absorbed entirely by
domestic users. While there has been a
recent increase in exports to China and
Taiwan, the Far Eastern markets are in a
state of chaos that will continue well into
the next year. On a more positive note,
the summer vacation lull in Europe came
to an end and shipments to that region
should improve soon.
The Mexican
market is performing well and the outlook
for the next few months should remain
fairly positive.
Profit margins for most hardwood
suppliers are shrinking. This is the direct
result of slower sales, sawmills' limited
control over their raw material costs, and
the competitive business climate.
In anticipation of slower sales, most
sawmills are not increasing their output.
Thus, there is not much over-production at
this time, preventing any major price
erosion for most lumber items. Some
sawmills have reduced their inventory
levels in order to improve their
profitability.
Many mills are taking steps to create
additional revenues to remain viable.
Increasingly, mills are using lower grades
to produce crating, pallets, and dimension
goods. In some cases these products are
for
specialised
industrial
niches.
Similarly, dry kiln operators are attacking
the profitability dilemma by improving
quality and reducing drying degrade. The
hardwood industry has become more
astute in locating alternative opportunities
in order to counter an erosion of their core
business.
As is normal in times of slower sales,
buyers are becoming more demanding.
Downstream product manufacturers are
asking for "just-in-time shipments" from
hardwood suppliers, allowing them to
reduce their own investments in lumber
inventories. Users of hardwood lumber
are also asking for special qualities such
as
no mineral in the wood, colour
selection, special widths, lengths and
grades. Selling lumber is no longer a
simple process where salesmen have only
one price for each species, grade and
thickness.
US domestic demand for hardwood
lumber will be steady for the next few
months followed by a slight export
induced upswing in the fall. Supply of
most hardwood species is anticipated to be
adequate to meet the demand. Under this
scenario, the outlook for the balance of
1998 and early 1999 is fair and prices for
most species and grades should not
decline much further.
Outlook by Region
Northern Region: The order backlog for
lumber producers is good. Some sawmill
operators shortened or eliminated their
traditional shutdown during the vacation
period.
Appalachian Region: With the end of the
vacation period, most sawmills are
operational again and business is picking
up where it left before the holiday. In
some areas, shipments have been delayed
15
due to transportation problems. In West
Virginia, rail car shortages as well as truck
availability has been poor. The rail car
shortage is in large part due to many rail
lines having been abandoned or taken over
by short-lines with limited services.
Southern Region: The volume of lumber
moving from Southern producers to
Mexico is quite strong. This, coupled
with a steady increase in shipments to the
West Coast and strong moulding demand,
has left most producers with good order
book positions. Unusually dry weather has
resulted in most mills having a normal
supply of logs.
Outlook by Species
The following reviews the trends for
various species. All prices refer to 1000
board feet (MBF, 1-inch thick, top quality.
Imported lumber prices are at West Coast
port of entry. Approximately $ 50.00 will
have to be added for East Coast ports.
Mahogany: The steep price increases for
Mahogany last year have come to an end.
Since the beginning of this year, prices
have remained remarkably stable,
nevertheless, the price of the timber is still
7% higher than one year ago.
Mahogany (at West coast port of entry)
KD US$2885 No change
AD US$2525 No change
Meranti: Prices for the different kinds of
Meranti have remained stable since
December 1997. However, prior to that
date, Meranti was subject to significant
inflationary pressure. Today's prices are
almost 4% above those paid in July of
1997.
Meranti (at West coast port of entry)
Clear, dark red
KD US$2385 No change
Clear, light red
KD US$2220 No change
Red Oak: Sales of Red Oak are quite
strong as manufacturers of cabinets,
furniture, flooring and other secondary
wood products have excellent order
backlogs. This applies in particular to the
Northern and Southern growing regions.
Summer is the prime drying season for
Red Oak. Much lumber is coming onto
the market which will prevent prices from
rising in the coming months. The demand
for common grade lumber, as well as for
thick stocks, may slow slightly, but prices
may decline only marginally, if at all.
Housing starts are still good in the US,
thus flooring Oak prices will remain firm.
Red Oak
Northern Region KD US$1608  US$5
AD US$1290 No change
Southern Region KD US$1323  US$10
AD US$1025  US$5
Appalachians
KD US$1488  US$5
AD US$1160  US$5
White Oak: The White Oak market
suffers under sluggish export sales. The
demand for common grade White Oak is
particularly slow and intense competition
has resulted in a softening of prices in
overseas markets. The domestic market
has absorbed some of the export shortfall,
but a build-up of excess inventory could
not be prevented. Exports of White Oak
to Europe should improve this fall. The
Spanish White Oak market remained
relatively good.
White Oak
Northern Region KD US$1330 No
Change
AD US$945  US$10
Southern Region KD US$1210  US$40
AD US$920 No Change
Appalachians KD US$1393 No Change
AD US$1018  US$5
Hard Maple: After two years of record
summer output, the market for Hard
Maple has softened noticeably and prices
are lower in all regions and for all quality
grades. With winter-cut lumber gradually
being used up, it is possible that prices
will strengthen slightly this fall.
16
Hard Maple
Northern Region KD US$1825
AD US$1335
Appalachians
KD US$1725
AD US$1245
 US$50
 US$50
 US$50
 US$65
Soft Maple: Recently, the demand for Soft
Maple has been fair at best. Sales of Soft
Maple may increase in the coming months
as many buyers will use Soft Maple as an
alternative species for Cherry. Prices of
Soft Maple may follow in the wake of the
steady price increase of Cherry.
Soft Maple
North Region
Appalachian
KD US$1228 No Change
AD US$890  US$5
KD US$1288  US$5
AD US$940 US$5
Cherry: The lumber and veneer markets
for Cherry is booming and the common
grades of the wood are also in strong
demand.
During the next few months
Cherry production will be at its seasonal
low.
Supply is likely to fall short of
demand, resulting in further price
increases.
Some manufacturers have
started to switch to alternative species
such as Alder and Soft Maple.
Cherry
Appalachians KD US$2705  US$20
AD US$2235 No Change
Walnut: Walnut prices came under some
pressure during summer, however, sales
have improved recently.
There is a
renewed demand from European as well
as domestic markets, which may further
strengthen in the next few months.
Analysts expect to see some firming in
Walnut prices, first in the upper grades,
then followed by the common grades.
Walnut
Appalachians
Yellow Birch: Yellow Birch prices have
remained steady. With a good demand for
white cabinets and furniture, Birch should
continue to enjoy a favourable market
position.
Birch is often used as a
substitute for higher priced species, such
as Hard Maple and Cherry.
Ash: The demand for the mid- and lower
grades of Ash has been on the increase
over the last few months, but the upper
grades have been slow to follow. The
traditional export markets for Ash have
not been active, and little improvement is
expected in the next few months. It is
possible that we will see an increased
domestic demand and firmer prices in the
fall.
Basswood: Basswood is widely used for
wooden blind and shutters. With new
housing starts at high levels and
remodelling business good, Basswood
demand should remain steady for a while.
However, the increased use of substitute
species such as Ramin from South East
Asia and Poplar are causing stiff
competition for Basswood and this will
prevent prices from rising much above
present levels.
Poplar: The demand for Poplar is
primarily domestic, although some
shipments go to Mexico and China. Sales
of upper grade Poplar are steady, but sales
of the common grades are only fair.
Sawmills have not increased the
production of Poplar lumber this spring
and summer as better returns can be
obtained for veneer grade Poplar logs.
Some steadying in Poplar prices may be
possible this fall.
Compiled by AKTRIN from various sources
including Hardwood Review,
www.Hardwoodreview.com
KD US$1903  US$20
AD US$1385 No Change
17
If any of your colleagues would like
to receive an E-mail copy of our
twice monthly market report, please
send their E-mail address to:
mjadams@itto.or.jp
18
World Value of the US Dollar 11 September 1998
Australia
Dollar
1.6715
Indonesia
Rupiah
11,575.00
Austria
Schilling
11.8995
Ireland
Punt
0.675
Belgium
Franc
34.9
Italy
Lira
1670.75
Bolivia
Boliviano
5.56
Japan
Yen
130.95
Brazil
Real
1.179
Korea, Rep. of
Won
1366
Cambodia
Riel
4015
Liberia
Dollar
1
Cameroon
C.F.A.Franc 567
Malaysia
Ringgit
3.8
Canada
Dollar
Myanmar
Kyat
6.3071
Central African Republic C.F.A.Franc 567
1.5112
Nepal
Rupee
67.925
China
Yuan
8.279
Netherlands
Guilder
1.9083
Colombia
Peso
1508
New Zealand
NZ Dollar
1.9247
Congo D.R
New Zaire
175.09
Norway
Krone
7.568
Congo, People's Rep.
C.F.A.Franc 567
Panama
Balboa
1
Cote d'Ivoire
C.F.A.Franc 567
Papua New Guinea
Kina
2.2753
Denmark
Krone
6.438
Peru
New Sol
3.069
Ecuador
Sucre
5555
Philippines
Peso
43.7
Egypt
Pound
3.4038
Portugal
Escudo
173.37
Fiji
Dollar
2.04
Russian Fed.
Ruble
11.428
Finland
Markka
5.1508
Spain
Pesata
143.5
France
Franc
5.67
Sweden
Krona
7.9499
Gabon
C.F.A.Franc 567
Switzerland
Franc
1.3865
Germany
Mark
1.6913
T hailand
Baht
40.7
Ghana
Cedi
2325
T ogo, Rep.
C.F.A.Franc 567
Greece
Drachma
292.22
T rinadad and T obago
Dollar
6.2415
Guyana
Dollar
152.3
United Kingdom
Pound
0.593
Honduras, Rep.
Lempira
13.5
Venezuala
Bolivar
587.275
India
Rupee
42.501
EU
Ecu
1.1601
Abbreviations
LM
FOB
SSQ
AD
Boule
Loyale Merchant, a grade of log parcel
Free-on-Board
Select Sawmill Quality
Air Dry
A Log Sawn Through and Through
the boards from one log are bundled
together
BB/CC Grade B faced and Grade C backed
Plywood
MBF 1000 Board Feet
Sq.Ft Square Foot
FFR
French Franc
Koku 0.278 Cu.m or 120BF
Cu.m
SQ
KD
FAS
Cubic Metre
Sawmill Quality
Kiln Dry
Sawnwood Grade First and
Second
WBP Water and Boil Proof
MR
Moisture Resistant
pc
per piece
ea
each
BF
Board Foot
MDF Medium Density Fibreboard
F.CFA CFA Franc
 
Price has moved up or down
19
ITTO FELLOWSHIP PROGRAMME GRANTS
ITTO offers grants for training and technology transfer through its fellowship
programme to promote human resource development, development of downstream timber
industries and institutional strengthening in the forestry sectors of member countries. The
priority areas are: Forest Industry; Economic Information and Market Intelligence; and
Reforestation and Forest Management. Grants are provided for a variety of activities
including: study tours of forests, mills and research institutions; participation in conferences,
workshops and training courses;
including Ph.D.;
postgraduate programmes (partial tuition grants), not
short-term research; technology transfer to tropical producer member
countries; and preparation of technical documents.
Applications are required to conform with ITTO’s general objectives in respect of
sustainable forest management, utilisation and trade and, in particular, the Year 2000
Objective. The grant is a maximum of US$12,000. Only nationals of ITTO member countries
are eligible to apply.
A Fellowship Selection Committee appraises applications at the ITTO Council Sessions in
May and November/December each year. Applicants should note that grant funded activities
should not start until at least one month after the relevant Council Session. The next deadline
for applications is 10th March 1999 and this is for activities that can begin in June 1999 at
the earliest.
Further details and application forms (in English, French or Spanish) are available from:
Dr. Chisato Aoki, Fellowship Programme, ITTO,
E-mail
itto@mail.itto-unet.ocn.ne.jp
Appendix 1
Tropical Timber Product Price Trends
20
Tropical Hardwood Log FOB Price Trends 1997-98
110
90
70
50
1997
Aug
Jul
Jun
May
Apr
Mar
Feb
Jan
Dec
Nov
Oct
July
Aug
Sept
30
1998
Meranti SQ & Up
African Mahogany L-MC
Sapele L-MC
Calophyllum
Keruing SQ & Up
Obeche L-MC
Iroko L-MC
Tropical Sawnwood FOB Price Trends 1997-98
120
110
100
90
80
70
60
50
1997
Aug
Jul
Jun
May
Apr
Mar
Feb
Jan
Dec
Nov
Oct
Sep
Aug
40
Jul
Price Index (Jan 1997 = 100)
Price Index (Jan 1997 = 100)
130
1998
Meranti
Brazilian Mahogany
Sapele
Iroko
khaya
Utile
Wawa
21
Tropical Plywood FOB Price Trends 1997-98
110
100
90
80
70
60
50
40
1997
Aug
July
Jun
May
Apr
Mar
Feb
Jan
Dec
Nov
Oct
Sept
Aug
30
July
Price Index (Jan 1997= 100)
120
1998
Indonesian 3mm
Indonesian 6mm
Brazilain Virola 5.2mm
Brazilian Pine 9mm
Malaysian 3mm
Malaysian 9mm
22